April 14, 2022

What is a Privacy Impact Assessment? (PIA)

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Mark Rowan

A Privacy Impact Assessment (PIA) is a method for detecting and managing privacy risks associated with new projects, initiatives, systems, processes, strategies, policies, and business partnerships, among other things. It helps a variety of stakeholders, including the company and its consumers, in a variety of ways. Policies have been enacted in the United States, Canada and Europe to require and standardize privacy impact studies. Specifically, such policies and regulations include Canada’s Bill-C64, the European Union’s GDPR, the United States’ CCPA, and Canada’s future Bill C-11.

With this definition in mind, many organization leaders aren’t sure if they have to conduct a PIA for their specific business. For any business that uses and collects private data from consumers, a PIA is almost always a necessity. But how exactly does a privacy impact assessment work, and why does your business need to care about them? In this in-depth guide, we’ll explore everything you need to know about PIAs and data privacy compliance for your organization.

What is a Privacy Impact Assessment?

A privacy impact assessment is a form of impact assessment undertaken by an institution, generally a government agency or company, that has access to a considerable volume of sensitive and private data about persons in its system or flowing through it. The company examines its own procedures to see how they influence or potentially endanger the privacy of the people whose data it gathers, stores, or processes.

A PIA is usually created to achieve three key objectives:

  • Ensure that all privacy-related legal, regulatory, and policy standards are met.
  • Identify and assess the risks of data breaches and other incidents, as well as their consequences.
  • To reduce unacceptable risks, identify suitable privacy safeguards.

A privacy impact report aims to identify and document the main components of any proposed system containing considerable quantities of personal information, as well as to determine how the system's privacy concerns may be controlled. A PIA may go beyond a system evaluation to include key downstream impacts on persons who are impacted by the proposal in some manner.

It's important to note that a PIA isn't only a legal checklist or a one-time activity. It's also not a marketing tool that simply displays the project's advantages, nor is it a justification for policies or practices that are already in place. It's also not a long, expensive, and resource-intensive process.

Why Do PIAs Matter?

To put it simply, there are constantly new and evolving global laws and regulations surrounding data privacy. Many of such laws and regulations require the use of PIAs in order for organizations to remain compliant. Alternatively, a PIA can simply be beneficial for those who want to be compliant with global privacy regulations.

Under Canada's new Bill 64, for example, corporations must post governance principles and, if information is gathered by technical methods, a confidentiality policy within the following two years. Bill 64 also mandates that enterprises do privacy impact evaluations of systems that handle personal data and when data is transported beyond the Quebec border. This will very certainly be a major undertaking for businesses. Organizations will also need to sign into contractual agreements with service providers and data processors that include certain terms, such as data processing agreements with third parties processing information on their behalf. Internal processes and procedures, as well as privacy policies affecting the public, will be affected by these changes.

Are There Any Benefits to Conducting Privacy Impact Assessments?

Even if regulatory authorities do not demand them, completing privacy impact studies has a number of organizational benefits. PIAs serve as an early warning system or a method of detecting privacy issues. As a result, organizations may put in place protections before making large investments, rather than afterward. PIAs also allow for the sooner rather than later resolution of privacy issues. It is possible for businesses to avoid making costly or embarrassing privacy blunders. PIAs also show that an organization made an effort to avoid privacy risks, protecting them against unfavourable court judgements, unfavourable publicity, and reputational harm.

PIAs also aid in informed decision-making, assist in gaining public trust and confidence, and indicate to important persons (workers, contractors, customers, and citizens) that the business values privacy.

In addition, conducting a PIA in combination with a data mapping program, will provide an organization with a complete view of its data, supporting the overall growth and operational efficiencies of the business.

When Does an Organization Actually NEED a PIA?

As an example, the TBS Directive on Privacy Impact Assessment mandates PIAs, which have been a policy obligation since 2002. If your program or activity may have an impact on people's personal information, you should conduct a PIA. Institutions must undertake PIAs in accordance with the Directive on Privacy Impact Assessment:

  • When personal data is utilized in a decision-making process that has a direct impact on the individual.
  • When large changes are made to current programs or activities, personal information may be utilized for administrative purposes (i.e., as part of a decision-making process that directly impacts the individual).
  • When current programs or activities undergo significant modifications.
  • When changes in regulations or data privacy laws may impact the business.
How to Conduct a Privacy Impact Assessment Step-By-Step
Perform a threshold analysis.

The first stage in the PIA process is to determine if your project requires a PIA. One isn't required for every endeavour. You should also think about your company's risk management procedures and the data that will be involved in the project that you are managing. Will it be sensitive in nature?

Make a plan for your PIA.

After you've finished your threshold assessment, you can start thinking about how you'll conduct your PIA. When preparing your PIA, think about how extensive it has to be (based on an evaluation of the project and its privacy scope), when it needs to be done, who will do it, and how much money and other resources you have to complete the process. In general, whoever is in charge of the project must ensure that a PIA is completed.

Describe your project in detail.

A succinct, big-picture explanation of your project should be included in your PIA. The project's overarching goals, how these goals fit into the organization's wider objectives, and the project's scope are all examples of context for the remainder of the PIA. To ensure that external stakeholders understand the project, keep the project description simple and minimize jargon.

Stakeholders should be identified and consulted.

The next phase in the procedure is to determine which stakeholders you will need to consult. This is a crucial step in the PIA process. The importance of consultation in gaining company support for a project cannot be overstated. Consultation can help to resolve concerns, give stakeholders confidence that their customer's privacy has been taken into account, and enhance a project's privacy procedures. Stakeholder consultation may also aid in discovering privacy hazards and mitigation solutions that might otherwise go unnoticed.

Make a flow chart for your data and start mapping.

This can be done with the help of a data compliance platform like Data Sentinel. That way, mapping information flow scan be automated to a great degree. In summary, you need to be able to answer these questions:

  • Do you have the appropriate legal authority to collect the PII that will be used data?
  • Have you received consent from your customers to use their data?
  • What data do you have and what is the condition of the data?
  • Do you have access to the needed critical data elements?
  • Are you using out-of-date or irrelevant personal data to make decisions?
  • Are you disclosing data to third-parties that are not authorized or who do not keep personal data appropriately secure?
  • Do you have processes in place to dispose of privacy data after use?
Understand privacy impact analysis.

One of the most crucial elements in the PIA process is the privacy impact analysis. Your privacy impact analysis will determine and assess how your project affects privacy, both favourably and adversely. Is the conclusion of your project acceptable or undesirable in terms of privacy? Is it possible to ameliorate any unfavourable privacy outcomes?

Consider possible privacy risks.

You may have discovered privacy issues in your project's existing design after conducting your privacy impact study and compliance review. Individual privacy, organizational compliance and reputation, or both may be at risk. Collecting more information than is required or utilizing intrusive methods of gathering are both risks.

Take into account your recommendations.

Your recommendations should identify any preventable consequences or dangers, as well as ways to eliminate or decrease them to a more acceptable level. The previous processes may yield a variety of recommendations for the project's future.

Prepare a PIA report.

You will have most of the material needed to complete your PIA report if you have recorded your progress through the previous eight steps of the PIA procedure. Your project description, the methodology you used to conduct your PIA, and a description of the information flows involved in your project should all be included in your PIA report. Your privacy effect analysis and recommendations should also be included.

Respond and re-evaluate.

After you've written and released your PIA report, the PIA process isn't over. It's critical to take action in response to the suggestions in your report, as well as to keep reviewing and updating your PIA. Where feasible, your organization's response should be published with your PIA report. If your PIA report hasn't been released yet, you might consider sharing it with key stakeholders to aid in the execution of recommendations.

How Data Sentinel’s Technology Can Help You Conduct Your Privacy Impact Assessment

At Data Sentinel, our data trust and compliance platform is designed to automate the data assessment and data mapping portion of your privacy impact assessment. In order to avoid human error, save time, and reduce the cost of your privacy impact assessment, our platform automates discovery, inventory and classification of your sensitive data. In an era where data governance compliance is more important than ever for protecting your organization and its data, Data Sentinel provides a way to ensure privacy regulations are met and maintained.

April 14, 2022

What is a Privacy Impact Assessment? (PIA)

Date:
Hosted By:
Register Now

A Privacy Impact Assessment (PIA) is a method for detecting and managing privacy risks associated with new projects, initiatives, systems, processes, strategies, policies, and business partnerships, among other things. It helps a variety of stakeholders, including the company and its consumers, in a variety of ways. Policies have been enacted in the United States, Canada and Europe to require and standardize privacy impact studies. Specifically, such policies and regulations include Canada’s Bill-C64, the European Union’s GDPR, the United States’ CCPA, and Canada’s future Bill C-11.

With this definition in mind, many organization leaders aren’t sure if they have to conduct a PIA for their specific business. For any business that uses and collects private data from consumers, a PIA is almost always a necessity. But how exactly does a privacy impact assessment work, and why does your business need to care about them? In this in-depth guide, we’ll explore everything you need to know about PIAs and data privacy compliance for your organization.

What is a Privacy Impact Assessment?

A privacy impact assessment is a form of impact assessment undertaken by an institution, generally a government agency or company, that has access to a considerable volume of sensitive and private data about persons in its system or flowing through it. The company examines its own procedures to see how they influence or potentially endanger the privacy of the people whose data it gathers, stores, or processes.

A PIA is usually created to achieve three key objectives:

  • Ensure that all privacy-related legal, regulatory, and policy standards are met.
  • Identify and assess the risks of data breaches and other incidents, as well as their consequences.
  • To reduce unacceptable risks, identify suitable privacy safeguards.

A privacy impact report aims to identify and document the main components of any proposed system containing considerable quantities of personal information, as well as to determine how the system's privacy concerns may be controlled. A PIA may go beyond a system evaluation to include key downstream impacts on persons who are impacted by the proposal in some manner.

It's important to note that a PIA isn't only a legal checklist or a one-time activity. It's also not a marketing tool that simply displays the project's advantages, nor is it a justification for policies or practices that are already in place. It's also not a long, expensive, and resource-intensive process.

Why Do PIAs Matter?

To put it simply, there are constantly new and evolving global laws and regulations surrounding data privacy. Many of such laws and regulations require the use of PIAs in order for organizations to remain compliant. Alternatively, a PIA can simply be beneficial for those who want to be compliant with global privacy regulations.

Under Canada's new Bill 64, for example, corporations must post governance principles and, if information is gathered by technical methods, a confidentiality policy within the following two years. Bill 64 also mandates that enterprises do privacy impact evaluations of systems that handle personal data and when data is transported beyond the Quebec border. This will very certainly be a major undertaking for businesses. Organizations will also need to sign into contractual agreements with service providers and data processors that include certain terms, such as data processing agreements with third parties processing information on their behalf. Internal processes and procedures, as well as privacy policies affecting the public, will be affected by these changes.

Are There Any Benefits to Conducting Privacy Impact Assessments?

Even if regulatory authorities do not demand them, completing privacy impact studies has a number of organizational benefits. PIAs serve as an early warning system or a method of detecting privacy issues. As a result, organizations may put in place protections before making large investments, rather than afterward. PIAs also allow for the sooner rather than later resolution of privacy issues. It is possible for businesses to avoid making costly or embarrassing privacy blunders. PIAs also show that an organization made an effort to avoid privacy risks, protecting them against unfavourable court judgements, unfavourable publicity, and reputational harm.

PIAs also aid in informed decision-making, assist in gaining public trust and confidence, and indicate to important persons (workers, contractors, customers, and citizens) that the business values privacy.

In addition, conducting a PIA in combination with a data mapping program, will provide an organization with a complete view of its data, supporting the overall growth and operational efficiencies of the business.

When Does an Organization Actually NEED a PIA?

As an example, the TBS Directive on Privacy Impact Assessment mandates PIAs, which have been a policy obligation since 2002. If your program or activity may have an impact on people's personal information, you should conduct a PIA. Institutions must undertake PIAs in accordance with the Directive on Privacy Impact Assessment:

  • When personal data is utilized in a decision-making process that has a direct impact on the individual.
  • When large changes are made to current programs or activities, personal information may be utilized for administrative purposes (i.e., as part of a decision-making process that directly impacts the individual).
  • When current programs or activities undergo significant modifications.
  • When changes in regulations or data privacy laws may impact the business.
How to Conduct a Privacy Impact Assessment Step-By-Step
Perform a threshold analysis.

The first stage in the PIA process is to determine if your project requires a PIA. One isn't required for every endeavour. You should also think about your company's risk management procedures and the data that will be involved in the project that you are managing. Will it be sensitive in nature?

Make a plan for your PIA.

After you've finished your threshold assessment, you can start thinking about how you'll conduct your PIA. When preparing your PIA, think about how extensive it has to be (based on an evaluation of the project and its privacy scope), when it needs to be done, who will do it, and how much money and other resources you have to complete the process. In general, whoever is in charge of the project must ensure that a PIA is completed.

Describe your project in detail.

A succinct, big-picture explanation of your project should be included in your PIA. The project's overarching goals, how these goals fit into the organization's wider objectives, and the project's scope are all examples of context for the remainder of the PIA. To ensure that external stakeholders understand the project, keep the project description simple and minimize jargon.

Stakeholders should be identified and consulted.

The next phase in the procedure is to determine which stakeholders you will need to consult. This is a crucial step in the PIA process. The importance of consultation in gaining company support for a project cannot be overstated. Consultation can help to resolve concerns, give stakeholders confidence that their customer's privacy has been taken into account, and enhance a project's privacy procedures. Stakeholder consultation may also aid in discovering privacy hazards and mitigation solutions that might otherwise go unnoticed.

Make a flow chart for your data and start mapping.

This can be done with the help of a data compliance platform like Data Sentinel. That way, mapping information flow scan be automated to a great degree. In summary, you need to be able to answer these questions:

  • Do you have the appropriate legal authority to collect the PII that will be used data?
  • Have you received consent from your customers to use their data?
  • What data do you have and what is the condition of the data?
  • Do you have access to the needed critical data elements?
  • Are you using out-of-date or irrelevant personal data to make decisions?
  • Are you disclosing data to third-parties that are not authorized or who do not keep personal data appropriately secure?
  • Do you have processes in place to dispose of privacy data after use?
Understand privacy impact analysis.

One of the most crucial elements in the PIA process is the privacy impact analysis. Your privacy impact analysis will determine and assess how your project affects privacy, both favourably and adversely. Is the conclusion of your project acceptable or undesirable in terms of privacy? Is it possible to ameliorate any unfavourable privacy outcomes?

Consider possible privacy risks.

You may have discovered privacy issues in your project's existing design after conducting your privacy impact study and compliance review. Individual privacy, organizational compliance and reputation, or both may be at risk. Collecting more information than is required or utilizing intrusive methods of gathering are both risks.

Take into account your recommendations.

Your recommendations should identify any preventable consequences or dangers, as well as ways to eliminate or decrease them to a more acceptable level. The previous processes may yield a variety of recommendations for the project's future.

Prepare a PIA report.

You will have most of the material needed to complete your PIA report if you have recorded your progress through the previous eight steps of the PIA procedure. Your project description, the methodology you used to conduct your PIA, and a description of the information flows involved in your project should all be included in your PIA report. Your privacy effect analysis and recommendations should also be included.

Respond and re-evaluate.

After you've written and released your PIA report, the PIA process isn't over. It's critical to take action in response to the suggestions in your report, as well as to keep reviewing and updating your PIA. Where feasible, your organization's response should be published with your PIA report. If your PIA report hasn't been released yet, you might consider sharing it with key stakeholders to aid in the execution of recommendations.

How Data Sentinel’s Technology Can Help You Conduct Your Privacy Impact Assessment

At Data Sentinel, our data trust and compliance platform is designed to automate the data assessment and data mapping portion of your privacy impact assessment. In order to avoid human error, save time, and reduce the cost of your privacy impact assessment, our platform automates discovery, inventory and classification of your sensitive data. In an era where data governance compliance is more important than ever for protecting your organization and its data, Data Sentinel provides a way to ensure privacy regulations are met and maintained.

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